The Federal Court, in the second significant case arising out of the Virgin collapse, has made extraordinary limited recourse and limited liability orders on application by the Administrators.

“As is well known, other than schemes of arrangement, Hong Kong has no legislation that provides for corporate debt restructuring or rehabilitation. This unsatisfactory state of affairs has been the subject of much invariably adverse comment for two decades now. It is brought into unforgiving focus by the economic problems that Covid-19 is causing.

Goulston & Storrs bankruptcy attorney Doug Rosner recently collaborated with Thomson Reuters to create a three-part video series regarding alternative solutions to the financial problems of distressed companies. This summary highlights the key elements to a successful out-of-court restructuring (part two of the series).

Directors and Officers (“D&O”) liability policies, like many other liability policies, often have an exclusion that precludes coverage when one insured sues another insured. Coverage, however, can be restored under certain exceptions. One of those exceptions is the bankruptcy exception, which allows a bankruptcy trustee or comparable authority to sue on behalf of the estate against another insured like a director or officer.

Questions from a landlord's perspective

My Tenant has asked for a rent holiday. I want to help them out at this time - how can I facilitate this?

Most landlords and tenants are working well together to reach agreement in respect of rent, either moving rental payments to monthly rather than quarterly in advance, or deferring rental obligations for a specified period. It is obviously preferable, but not necessarily essential, to have such arrangements documented in writing, as follows:

Liquidators have a limited time in which to bring proceedings in respect of voidable transactions, generally three years from the relation back day (Limitation Period).[1] However, a Court may grant liquidators a longer period to bring a voidable transaction claim provided the liquidator makes an application for this extension within the Limitation Period itself.

• With tenant closures and lease defaults on the rise in the wake of the economic downturn caused by the COVID-19 pandemic, tenant bankruptcy filings are a major concern for landlords across the real estate industry.
• As courts of equity, bankruptcy courts not only consider the specific facts and circumstances of each case but also, because of the overriding goal of reorganization in bankruptcy, may subordinate other legal rights and policies.

The Coronavirus Economic Response Package Omnibus Act 2020 (Cth) (Omnibus Act) amended the Corporations Act 2001 (Cth) (Act) and the Corporations Regulations 2001 (Cth) (Regulations) with effect from 25 March 2020 to create a “safety net” for Australian businesses facing COVID-19 related financial distress.

The UK government introduced the Corporate Insolvency and Governance Bill (CIGB) to Parliament on 20 May 2020. As well as including temporary measures to help support businesses affected by COVID-19, it proposes significant permanent changes to UK insolvency law. These proposed permanent changes include a new company moratorium: a mechanism to give a company in financial difficulty a temporary breathing space against creditor action, during which the directors remain in control, but overseen by a monitor.

The United States Supreme Court opted not to hear a dispute regarding broad third party releases contained in a plan of reorganization which releases were held by lower courts to be binding on nonconsenting creditors. In the Third Circuit bankruptcy case of Millenium Lab Holdings II LLC, the bankruptcy court approved a plan containing such releases, a decision upheld on appeal by the District Court in Delaware and thereafter by the Third Circuit Court of Appeals. The Third Circuit's decision was largely based on its interpretation of the Supreme Court's decision in Stern v.